Exposure of many organisms to double-stranded RNA causes the degradation of mRNA molecules containing sequences homologous to the trigger dsRNA, a process termed RNAi. Genetic and biochemical analysis in model organisms, such as C. elegans, has demonstrated that much of the mechanistic underpinnings of RNAi are evolutionary conserved. Many fundamental questions remain to be addressed in the RNAi field including: (1) What are the endogenous biological functions of the RNAi machinery; and (2) Is RNAi, like most biological processes, under negative regulation? We have undertaken a genetic screen seeking to identify negative regulators of RNAi. These studies have thus far led to the characterization of the gene eri-1. Our results suggest that ERI-1 functions to negatively regulate R;NAi by degrading the small RNA executioners of RNAi (siRNAs). We have now begun to characterize four additional genes which function in a genetic pathway with eri-1 (termed the eri-1 pathway). Our preliminary data suggests that the eri-1 pathway proteins function in a complex with the C. elegans Dicer-like protein DCR-1 to regulate siRNA stability. Finally, our data indicate that the eri-1 pathway proteins are required for a novel mode of gene regulation, a process we term endogenous RNAi. This proposal seeks to: (1) characterize the molecular function of ERI-1 in detail; (2) continue our genetic analysis of the eri-1 pathway genes; and (3) elucidate the role of the eri-1 pathway genes in the biogenesis and function of small RNAs in C. elegans. Initial successes utilizing siRNAs to target oncogenic and viral proteins have generated excitement that siRNAs may eventually be utilized to treat human disease. Understanding the endogenous biological activities of small RNAs and how these small RNAs are generated and regulated is essential prior to the rationale use of siRNAs in treating human disease.